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Where can I learn more about Price Action like those in James16 charts? 9 replies

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james16 Chart Thread

  • #36,721
  • Jul 8, 2009 9:11am Jul 8, 2009 9:11am
oh sorry, I guess since i was looking at the chart after the fact it looked as if that would have made sense, but anyway I think that if you did that you would have been taken out of a bad trade with minimal loss, which is a good thing :-). I think thats what Jaroo and the bar break setup is all about. To eliminate non high momentum setups with small losses.


Quoting unlv_tj
Thank you dmc...

"Something that Jaroo taught me is the bar break stop, whcih would still keep you in this trade with reduced risk. After the bar breaks put your stop behind the bar that breaks it, that way if it is not a momentum setup you will be stopped out with lower risk, because to be hionest you dont want to be in a low momentum setup on the 4hr IMHO"

The bar broke and then was slammed down 50 pips below its previous low, so this would not have worked either.

This stuff is damned tough.
  • #36,722
  • Jul 8, 2009 9:14am Jul 8, 2009 9:14am
Quoting unlv_tj
R:R ratio. If I kept the stop loss about where I had it, I would end with a 1:1 return. If I put the stop loss below the bar, my return would be about 1:2. If I trade with 1:2, my win rate would have to be VERY high to make a profit.

With that said, I guess my question is...

Was this a good trade, in your opinion? IMO, it was a good trade, and some trades just lose. But I maybe over looking something.

I took the trade due to the nice pin bar, in a good location, with RSI divergence.
UNLV,
I don't want to sound rash or mean here... please take this as kind words of advice from what I've learned. The reason for you placing your stop loss where you did should not have anything to do with R:R... you are thinking backwards.

The best traders first consider RISK... then let profits worry about themselves...

The wording you used above says that you determined where you would take profit and then placed your stop accordingly.... instead, proper money management would say to 1. Place your stop where you might (under the left eye is ok, if that is all the room you want to give it), 2. Position size accordingly, and 3. Consider where you might run into problems.

After doing all that, THEN you look to see if the problem area would still allow you to reach your desired R:R... if it doesn't allow this, then NO TRADE (or manage the trade accordingly).

Maybe you just worded your response poorly. In which case, disregard this post. Another question to ask yourself: Have you backtested the idea of placing the stop behind the left eye on 4hr charts? If so, then you should have an idea of how often GOOD setups fail because of the close stop. For the record, I think it was a good setup...

Hope you find this helpful. Please be skeptical/curious about this way of thinking, as I'm not an expert by any means. Just what I've found over the last 6 months. Happy trading,

Josh
  • #36,723
  • Jul 8, 2009 9:29am Jul 8, 2009 9:29am
It's funny to see people trying to copy someone and they have no clue on why or how it is done, Why don't you find something that works for YOU just like I have always done, if you are going to copy someone else without knowing 100% why how and when they are doing it your going to lose. Years ago when I did the 3min thing it took me about 6 months with phone calls and e-mails DAILY with my mentor to get it down what he was doing, I don't think a few charts of what he is doing is going to get you in the winning area. Why not just do the PB's with something else you know like fibs, BB, RSI, or whatever voodoo you want to use but trying to copy someone else and not knowing the FULL deal is just a waste of time as well as you will never get it unless you have the time to call and work with that person and understand EVERYTHING.

It's seems we are back to the "Has to be hard" to make money again, I am not that smart that's why I just use PB's and throw the RSI and BB on it because it's what I understand, no need to add more crap to it unless I want to start losing money or LOOK smart and either of them are not what I am after.
Keep taking CT trades, I need more money
  • #36,724
  • Jul 8, 2009 9:52am Jul 8, 2009 9:52am
Hey guys, first post here, but I have been reading up and learning for a while now. Live trading small money because it's the only way I can care about whether my trades win or not. Having at least a little money on the line really causes me to think things through. Demo doesn't do it for me. Thanks everyone for the thread and all the info here on FF.

Anyway... anyone long on GBP/CHF right now? I set a limit overnight to buy at 1.7510 because it looked too good not to reverse. Didn't want to wait for a pin because I felt it would happen overnight, and it did. Currently 33 pips in profit and stop at 1.7490, will move to break even after the current resistance is broken. Profit at 1.7780 but that it subject to change either way depending on the market. 100% fib since last run and 61.8 fib since the previous along with 1.75 psych level and huge past support/resistance and long term up trend line converging on the more recent down trade line all made me think this was a A+ trade.

Thoughts anyone?
  • #36,725
  • Jul 8, 2009 9:52am Jul 8, 2009 9:52am
Quoting Ryanmcd
It's funny to see people trying to copy someone and they have no clue on why or how it is done, Why don't you find something that works for YOU just like I have always done, if you are going to copy someone else without knowing 100% why how and when they are doing it your going to lose. Years ago when I did the 3min thing it took me about 6 months with phone calls and e-mails DAILY with my mentor to get it down what he was doing, I don't think a few charts of what he is doing is going to get you in the winning area. Why not just do the PB's with...
here here, it seems the end of bar SL has been abandoned!!?? in favour of R:R??? i dont get it!
jon
PATIENCE... DISCIPLINE
  • #36,726
  • Jul 8, 2009 9:55am Jul 8, 2009 9:55am
Not sure if you are being sarcastic, I hope you are not because I am a huge fan and "understander" of ened of bar stop loss. We take thise trade off of SR levels witht he pin piercing these levelsbut coming back giving us reason to believe to go opposite of pin and havign a stopp loss at that support or resistance and being confident it will not break that area!!!! becasue of both the pin and the S/R and whatever other confidence. Trade towards the least amount of resistance!!!!


Quoting g_j_hook@yah
here here, it seems the end of bar SL has been abandoned!!?? in favour of R:R??? i dont get it!
jon
  • #36,727
  • Jul 8, 2009 9:58am Jul 8, 2009 9:58am
Quoting Ryanmcd
It's funny to see people trying to copy someone and they have no clue on why or how it is done, Why don't you find something that works for YOU just like I have always done, if you are going to copy someone else without knowing 100% why how and when they are doing it your going to lose. Years ago when I did the 3min thing it took me about 6 months with phone calls and e-mails DAILY with my mentor to get it down what he was doing, I don't think a few charts of what he is doing is going to get you in the winning area. Why not just do the PB's with...
I have two people that I follow in trading. J16 is one and my mentor from years ago is another. James has many successful followers and I'd bet that each one trades differently from each other with James' method being the basis for what they do. From my mentor, he has taught quite a few people who have become successful and they all trade differently, but again his method is the basis of what they do. Then of course there are folks who just can't trade successfully using either of the methods. It's all personal, it's all about comfort level. Warren Buffett copied what Ben Graham did but then when off on his own with his own style. It's all about understanding your perception of the market place
  • #36,728
  • Jul 8, 2009 10:13am Jul 8, 2009 10:13am
Man, I wish they would require 25k to enter forex, it would take out a lot of the $500 1/2 ass traders in this market and clean the forums up and maybe then people would try harder or at least be a little smarter.
Keep taking CT trades, I need more money
  • #36,729
  • Jul 8, 2009 10:24am Jul 8, 2009 10:24am
Quoting Jduester
UNLV,
I don't want to sound rash or mean here... please take this as kind words of advice from what I've learned. The reason for you placing your stop loss where you did should not have anything to do with R:R... you are thinking backwards.

The best traders first consider RISK... then let profits worry about themselves...

The wording you used above says that you determined where you would take profit and then placed your stop accordingly.... instead, proper money management would say to 1. Place your stop where you might (under the...
I disagree, but I appreciate your kind words and the time you devoted to me to type them.

The reason I disagree, is I read this thread nonstop. Most all anyone posts are their winners. A few weeks ago, Rac posted a loss, and it was awesome. Even someone as great as him has losses.

I have back tested the hell out of this, I have been at it for over two years, and I can simply say "this is hard as hell". If it wasn't, all of us would be millionaires. Instead, I would guess only 5 or so guys on this thread are even returning a positive profit result.

With that said, I know you have back tested and found that 1:1 win ratio has worked for you. I set my stop loss below the left eye, and only got into the trade on a break, believing that it would constitute a strong move with the Pin.

This did not happen, and I took a loss. But the first thing in my mind is risk. How much did I put down. How much was I willing to risk to say this set-up in my back testing wins xx% of the time.

I was just looking to see if I missed anything. Reading the responses, it appears the only thing I missed was the questioning of my SL. Which I personally stand by, as I have used the full bar stop loss in the past, took profits at the correct resistence, win 4 out of 5 trades, and still have a loss on the ballance sheets.

Just trying to bring about some new thinking here. There is MUCH more to this than entries, and MUCH more to this than win-win-win (not directed at you Josh, you are one of the posters I see who dynamically think this through more so).

Thanks everyone!
  • #36,730
  • Jul 8, 2009 10:24am Jul 8, 2009 10:24am
Hello GJ,

I think it depends on your style of trading and I always think R:R is really important.

a. Jarroo style is try to minimie the loss and take profit quicker (At the first PPZ or resistance or concerned area). So his style need to minimze the loss and try to manage it to let the trade run longer after take the first profit. The trade he picked does not always to be A or A+ but try, but his win rate is very high and people can trade with smaller account size for bigger gain. Higher R:R ratio.

b. Some people's style is take the full PB stoploss, and if they want to win long term they have to workout the R:R ratio. Because of that, they will need be very picky choosing the trade and make sure it is a workable trade to come up with a proper R:R. They take profit at least 1:1.

My experience, I try Jarroo style with take profit at first support or resistant level and move BE ASAP. If I always take full bar loss, my account does not grow after trading for sometime because if I encounter a big full PB loss my previous profit will be wiped out alot.

My account is not that big and I want to get consistent account growth, I will take Jarroo's approach. It takes more time to babysit the trade but the R:R can help me get the account build up slowly.

That is what my finding so far and will keep praticing how to minimize the loss.

Thanks

Pipping





Quoting g_j_hook@yah
here here, it seems the end of bar SL has been abandoned!!?? in favour of R:R??? i dont get it!
jon
  • #36,731
  • Jul 8, 2009 10:46am Jul 8, 2009 10:46am
I almost took that setup! But i think u conveniently ignored the 133.60 price zone!

Quoting unlv_tj
Damn, took a loss on a 4H pin bar on the EURJPY.

I have been very picky with my entries and working on R:R Money management.

I believe this was a good trade. I put the stop loss about 15 pips below the left eye and played the break. Went about 15 pips in my favor (too little to take profit), then slammed down to stop me out.

Thoughts?
  • #36,732
  • Jul 8, 2009 10:50am Jul 8, 2009 10:50am
Thank you Razor, I had my TP just above that level at 131.70.

It got to 131.52 on my feed.
  • #36,733
  • Jul 8, 2009 10:58am Jul 8, 2009 10:58am
Quoting unlv_tj
I disagree, but I appreciate your kind words and the time you devoted to me to type them.

The reason I disagree, is I read this thread nonstop....
I would just add a couple of things to this:

With more aggressive stop placement comes a lower win rate. Higher risk to reward ration, but lower win rate. That's the trade off. I am sure you've noticed this from your extensive backtesting.

So I think maybe the reaction you're getting is to do with you saying that this stuff is really hard and asking for input on a loss. A lower win rate means some losses and some wins and coming out on top over the long run. When someone posts a loss and asks for input on what went wrong, often the only answer is "it's a loss". Your performance will be measured across months of trading. As you yourself say, there is much more to this than Win-Win-Win, especially with aggressive stop placement.

That's where the backtesting and demoing you did should give you confidence, more so than any forum reaction to your individually posted loser would do. Trust your data and your plan, view losses as just that, and review after 6 months.

There's a psych point here as well. When things get tough in trading, and they do for all of us, (and here I can only speak from my own experience), please be wary of the "people only post winners here and only a handful are making money" line of thought. This will kill you. It will slaughter your mindset and lead to revenge trading or even worse, throwing a bunch of negative energy out onto the forums. "If it was so easy all of us would be millionaires". That's the beginnings of this kind of thinking.

I hope you take my remarks in the spirit they are intended. I sense that things might be a little painful right now, and the reaction to your posts has perhaps taken you by surprise.

Good luck with everything.

Aaron
  • #36,734
  • Edited 11:13am Jul 8, 2009 11:00am | Edited 11:13am
People keep mentioning / hoping I post more. I don't understand. People like Jarroo et al already post all the good stuff. The weekly oil BEOB for example.

But since I read somewhere around here that there were no setups or at least no apparent ones and that, really, daily bar trading like, totally sucks, I thought I might just throw up 3 charts/progressions. Those totally sucky dailies basically spat out several 1:1-1:3 (and more) setups in the space of, well, uhm, days.

Basically what I'm saying in terms of ANY timeframe setup isn't "Don't take/trade them", I'm saying make sure you're good at it, then "Just do it".
I don't think there really ever needs to be a "xyz is best and that's the end of it" in the first place..if you CAN trade the 3M or 5M or tick chart etc pp, go for it. If you CAN trade the 1h, 4h, then go for it.
I just personally think it would be super-silly to just ignore the end of day trading(or, in Oil's case, end of week) you can do with 1 order and 1 adjustment a day and not do that as well.
Why is everything always so black and white?


About the charts:
This has probably become obvious already, but I've begun simply "tracking" the progression of trades to eliminate the "could just be drawn in afterwards" angle to begin with. I am still not posting any of these "live" for a good reason.

Anyhow. Sorry for not having a "before" chart of EURAUD, but given that it trades inversely with AUDUSD and the stock markets, I felt it was a bit of a duplicate to being short AUDUSD, short AUDJPY, short xxxJPY..well, you get the idea. Lower stocks, lower "value" pairs. But it did show well how stuff moves from x to y to z, so I included it.

As for the charts - yes I am aware the setups on EURJPY for example are "mix and match" in terms of chart feed..I do that. I like charting pairs on both feeds.
For me it just meant more confirmation of the move lower being underway. Also please just ignore the "squiggly lines" if you want.

As for the FEs, that's just rudimentary help in "targetting". Bundy knows what it's all about

Charts part 1 of 2:
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Trust price. Know yourself.
  • #36,735
  • Jul 8, 2009 11:07am Jul 8, 2009 11:07am
Gold, also formed a weekly IB. Tons of "what to do next" struggling on the daily.

This is basically just a really lagged "USD strength / commodity weakness" trading thing at the moment I guess, and me taking advantage of the fact that virtually every place else has already "given away" direction ahead of time.
I guess all the gold bugs newsletters made gold stay afloat just that little bit longer than everything else.

What I am saying is - I saw a pattern (to me, and my hobby EW skills, a likely end of a 4th wave) on Gold, saw that others had already earlier formed it out and moved on it, saw daily PA and just took it. There was actually a TL in the way, but given how things are looking I just reduced size a bit and nonetheless took it.

This is probably 5000% over the top rationale and will have most KISS folks laughing. I dunno, it works for me, that's really all I want
KISS version: IBs on s/r, especially after windup, tend to work.

Basically everything posted is just "one trade"(one reason, source, mechanic...same direction/moves etc) - the destruction of value as stocks fall. But there was PA in all of it. Make of it what you wish

Charts part 2 of 2:
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Trust price. Know yourself.
  • #36,736
  • Jul 8, 2009 11:15am Jul 8, 2009 11:15am
Quoting Jduester
UNLV,
I don't want to sound rash or mean here... please take this as kind words of advice from what I've learned....
This is the point I was going to make. This is trying to curve fit your situation to meet YOUR needs. You have to either avoid the situation or take it and take what the market gives you. Your stop loss should be determined first. For me it is real simple. Pinbar stop below, trade mgmt. I don't say well if it goes from here to here I get 1:1 let me move my stop up. The stop is used based on the logic that a pinbar is valid till the low is taken out. ALWAYS be logical and SIMPLE.
  • #36,737
  • Jul 8, 2009 11:16am Jul 8, 2009 11:16am
Quoting Ryanmcd
Man, I wish they would require 25k to enter forex, it would take out a lot of the $500 1/2 ass traders in this market and clean the forums up and maybe then people would try harder or at least be a little smarter.
I still remember when I got involved it was 50k minimum and standard lots. The entrance of the more "retail" side makes position granularity AWESOME for compounding though
  • #36,738
  • Jul 8, 2009 11:18am Jul 8, 2009 11:18am
Quoting Ryanmcd
long eur/usd on the re-trace
Hey Ryan,
thanks for posting this. It ended up as a loss, but who cares. Point here is the setup fit the criteria, so we take it. If it works out, we never know, but what we do know is that weŽll be ahead over a series of trades. The one before it worked out nice btw.

RM
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  • #36,739
  • Jul 8, 2009 11:28am Jul 8, 2009 11:28am
Quoting Ryanmcd
Man, I wish they would require 25k to enter forex, it would take out a lot of the $500 1/2 ass traders in this market and clean the forums up and maybe then people would try harder or at least be a little smarter.
... I hear you.
NFA might look into it soon
  • #36,740
  • Edited 11:44am Jul 8, 2009 11:29am | Edited 11:44am
Quoting SeekingLight
.....Those totally sucky dailies basically spat out several 1:1-1:3 (and more) setups in the space of, well, uhm, days....
... And just because daily sucks Usd/jpy "monthly" 4IB just gave me 2% in a matter of seconds.... free trade now aiming for retest of 88/87 .
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